Bird & Bird

UK 200 RESULTS 2010

Technology specialist Bird & Bird continued its apparently permanent growth spurt last year off the back of its increased geographic reach and continued strengthening of various practice areas in a number of markets.

The expansionist firm broke through the £200m revenue barrier for the first time, posting a total turnover of £201.8m for the 2009-10 financial year.

In contrast with the 10 per cent rise in turnover, Bird & Bird’s average profit per equity partner figure fell for the second year running, from £481,000 to £466,000.

The reduction in average profit is also reflected in Bird & Bird’s relatively low margin for a City firm of 19 per cent. Although Bird & Bird’s net profit grew last year from £34.6m to £37.7m, with the overall growth in turnover that translated into a drop in the profit margin from 2008-09.

Although Bird & Bird has 81 full equity partners (up from 72 last year) it maintains that all of its partners should be categorised as equity thanks to its merit-based remuneration system. According to CEO David Kerr, on that metric the firm’s profit margin is closer to 35 per cent.

However, Kerr agrees that junior partners are effectively on a fixed-share basis until they enter the full equity. Only the latter were counted as part of the 18 per cent net profit last year.

Several of Bird & Bird’s contracts in its specialist litigation areas, such as IP, sports and technology, held up particularly well last year.

The firm’s financial year was characterised by international expansion. It is planning to open an office in Abu Dhabi, its first base in the Middle East region, while further afield it formed an alliance last year with Beijing IP boutique Xiang Kung Law Firm with the aim of strengthening its contentious capabilities in China.

Consequently, the proportion of revenue derived from overseas grew from 65 per cent to around 70 per cent.

In London Bird & Bird bolstered its corporate team with the hire of two partners from Orrick Herrington & Sutcliffe, Richard Eaton and Struan Penwarden.

UK 200 RESULTS 2009

Few firms have enjoyed as much growth over the past decade as Bird & Bird, and the technology-focused firm did not disappoint in 2008-09.

In a year when the majority of firms were posting flat or reduced figures, Bird & Bird saw its fee income rise by almost 30 per cent to £186.3m.

The revenue growth was largely down to the firm’s long-held ambition to be Europe’s – if not the world’s – leading full-service law firm for technology and IP-rich clients. That strategy has resulted in it casting its international net far and wide.

In the past two years alone Bird & Bird has opened offices in Helsinki (with its 1 May 2008 merger with Finnish firm Fennica), Bratislava (September 2008), Prague, Warsaw, Budapest and this year Singapore via its global association with Alban Tay Mahtani & de Silva on 1 January 2009.

It also acquired the respected aviation boutique Lane & Partners in the UK in October 2008.

True, the firm’s average profit per equity partner fell by 6.5 per cent to £481,000, but chief executive (and chief architect of the expansionist strategy) David Kerr will see that as a manageable drop in contrast with the top-line growth.

Bird & Bird has a surprisingly high proportion (40 per cent) of its fees generated by a broad spectrum of contentious matters, from contractual disputes to heavyweight IT and IP battles. This part of the practice has compensated for the inevitable downturn in its core transactional practices, although the corporate group benefited from competitive pricing to remain busy throughout the year.

Bird & Bird maintains that all of its 192 partners are members of the equity on the basis that the firm operates a merit-based compensation system in which all partners are paid out of the single global profit pool.

Partners at the lower end of the equity ranks, however, have a higher percentage of fixed income in their remuneration. On that basis the firm reported 72 full equity partners out of 192 at the year-end.